Feds, whistleblower agree to drop Dallas County from lawsuit

If there’s any confusion about whether Dallas County is a sharp focus of a U.S. Justice Department investigation into allegations of medical billing fraud at Parkland Memorial Hospital, Monday’s federal court docket offered a strong clue.

Apparently it isn’t.

Justice officials and the plaintiff behind the allegations in a recent whistleblower suit have agreed to dismiss the county government as a defendant, according to a motion filed yesterday. The other defendants are Parkland and five UT Southwestern Medical Center doctors.

Dr. Lien Kyri, a former Parkland resident trainee, alleges that the hospital and UTSW physicians submitted “hundreds of thousands” of bogus Medicare or Medicaid claims between 2006 and 2008. The claims were for physical rehabilitation consultations that were never ordered by the patients’ primary physicians as required, the suit says.

By law, the justice department must investigate allegations in whistleblower lawsuits, also known as “qui tam” actions.

But the “notice of dismissal’’ offered no explanation behind the decision.

Don Warren, Kyri’s California lawyer, told me earlier today that, despite the county commissioner court’s role in appointing Parkland’s governing board members and approving its budget, “we concluded that we did not need Dallas County as a party to the lawsuit because Parkland is its own separate entity.’’ ( Under state law, Parkland operates as the Dallas County Hospital District and is not a formal arm of the county government.)

Kathy Colvin, a spokeswoman for the U.S. attorney for the Northern District of Texas, confirmed that explanation.

But I asked Colvin and Warren if there was another reason: That the dismissal cleanly separates the billing fraud probe from the justice department’s criminal investigation into allegations of money laundering and influence peddling by Dallas County Commissioner John Wiley Price. By cutting the county out of the picture, justice officials could avoid any potential or perceived conflicts that could arise in dealing with Price’s commission over a resolution in the billing fraud investigation or Price’s case.

Colvin, Warren and other attorneys involved in both inquiries declined to comment on that possibility.